geert lovink on 9 Oct 2000 05:57:49 -0000

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<nettime> What ever happened to the New Economy?

[Is anyone following what is going on with the falling NASDAQ, tumbling tech
stocks? Here some random news snippets from last Friday. Has the Internet
Recession already arrived, in perfect timing with Mandel's book about to
come out? g.]

Falling Without A Net

Net stocks plunged to their lowest levels in a year, setting a dismal tone
for the week. Trepidation about oil prices, a tight job market and
lower-than-expected corporate earnings kept the Internet Economy down.
Several dot-coms closed their doors or cut staff., a site
that provided product information, ceased operations on Monday. Teen site, which could follow Productopia's lead, laid off 65 staffers.
Online marketplace eSprocket cut its staff in half. Net drugstore
also laid off a third of its staff in hopes of profitability by 2001.  There
was some good news with an increase in the number of visas permitted for
foreign-born workers - from 115,000 this year to 195,000 annually for the
next three years. After an almost unanimous vote by Congress, President
Clinton has said he will approve the measure.

Despite a terrible week in Net stocks -'s Internet Sector
index was down 12 percent - four Internet companies had IPOs. The market was
hit hard by fears of a slumping computer hardware sector in the wake of
Dell's warning of disappointing revenues. Accompanying the market downturn,
buzz about the Net economy slipped 11 percent, although traffic stayed
steady and site performance was 4 percent faster. The Internet Economy Index
rates the week of Oct. 2 a 3 (out of 10).

The Internet Frenzy Ends and TV's Ad Market Hits a Wall
By Stephen Battaglio
Sunday , October 08 06:29 p.m.
Television's red-hot ad market has gone into a deep freeze.

With the kick-off of the new fall season, the entire TV industry -- from
broadcast and cable networks to major syndication companies -- is finding
itself sitting on loads of unsold commercial time. One major ad-agency buyer
said the networks are entering the fourth quarter with only 80 percent of
their airtime sold -- sharply lower than the 88 percent to 90 percent that
is usually the case this time of year.

It's looking so grim that there is even speculation that broadcast and cable
networks may have to take the extraordinary step of selling their
commercials at prices below what they got in advance sales during the
upfront market this spring -- a practice known on Madison Avenue as
''dropping their pants.'' 'It's easy to pull an ad budget and add to the
bottom line,' one agency media director said. 'If there is a battle between
the financial guy and the marketing guy, the financial guy is
going to win.'


The freewheeling Internet spending that drove up prices earlier this year --
remember the Super Bowl ads from companies nobody had heard of? -- is over.
Many of those companies have either gone belly-up, or they don't have enough
money to keep their commercials on the air.

One by-product of the dot-com invasion is an end to a gentleman's agreement
that had prevailed in the TV ad business. The tradition on Madison Avenue
had been that once you bought fourth-quarter ad time, you stuck to that
commitment, even though months would pass before you actually signed a
contract and paid for it. But some large companies are now using the lag
time to cut back. ''The whole process is being abused a little,'' the
network sales chief said. ''A hold order is a moral commitment, not a legal
commitment. I guess people are getting amoral.''

Net Stocks Sell Off as priceline Leads the Way
By Justin Dini
Staff Reporter
9/27/00 6:21 PM ET

Big Internet stocks took a pummeling Wednesday after priceline
(PCLN:Nasdaq - news) said it wouldn't meet revenue expectations for the
third quarter. While priceline's problems -- the company blamed weakness in
its core airline ticket business for the shortfall -- appear unique, the
announcement came at just the wrong time for companies like Yahoo!
(YHOO:Nasdaq - news). Investors have had doubts about Yahoo! in recent
months amid slowdowns in online ad spending, especially by cash-short Web
companies. Yahoo! tumbled nearly 12% Wednesday, falling $12.06 to $90.38. Internet Sector index slid 6.1%.

"I think priceline's problems were specific to priceline, but the market is
weak and people have been losing confidence in a lot of these big names,"
says Rob Zidar, co-portfolio manager of Merrill Lynch's Internet Strategies
fund. "People have been looking for a reason to sell." Priceline's
announcement apparently gave them that reason. Among the other big names to
fall Wednesday were (AMZN:Nasdaq - news), off 4.7%, America
Online (AOL:NYSE - news), off 3.98%, and CMGI (CMGI:Nasdaq - news), which
was off $3.81, or 12.5%, to $26.63. priceline ended the day down $7.88, or
42%, to $10.75.

Razorfish Down More Than 40% After Profit Warning
By Yi Ping Ho
Staff Reporter
10/6/00 3:55 PM ET

Razorfish (RAZF:Nasdaq - news) plunged 43%, or $3.75, to $5 after the
Internet consulting and services company warned its quarterly earnings would
miss analysts' expectations. The company issued an earnings warning after
the bell on Thursday, forecasting lower-than-expected third-quarter net
income because of the seasonal impact in Europe and the strong dollar. The
company also said its third-quarter cash earnings before amortization of
goodwill and intangible assets will be 1 cent to 4 cents a share. Analysts
were looking for the company to earn 8 cents a share. Lehman Brothers
lowered its 12-month price target to $12 from $40 and cut its rating on the
company to outperform from buy. Credit Suisse First Boston set a $15 price
target on the company and cut its 2000 EPS estimate to 17 cents from 31
cents a share, but maintained a strong buy rating on the stock.

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